I have got some observations I listed below that probably effect the property prices in Italy.
I can't really say if Italians feel that property prices are expensive, its strange because they don't seem to show any emotion on the subject either way, they just shrug their shoulders so to speak. Not many Italian rent at all, if they can't buy a home they will stay at home with the family (they are very family orientated).
It is not uncommon for Italians to live with there parents until they are in there 40's which is seen in Australia as plain weird (luckily I don't live with my girlfriends parents :)
You can get very cheap places to stay in Italy along the seashore for around the 1000 euro mark per month (that includes furniture and sometimes electricity). The problem with being in Australia is you can't get those deals because you have to be here as they usually aren't advertised and are word of mouth.
Italy and Italians seem very different than Australians and how we do things. There is no negative gearing here and they aren't as "capitalistic". The government in Italy is a massive bureaucracy and you need a license to do just about anything and no one pays tax unless they are forced to which they aren't because the government doesn't seem that efficient either. Most people don't know what a tax return is here :) If you think Australians are relaxed you haven't seen nothin' :)
The Milanese council brought out a "moving tax" for people moving into or out of Milan (they said because of the extra trucks on Milans busy and disorganised roads). I'm not sure how it is applied but in some cases people would have to pay 3000 euro to move. Only Milan has introduced this tax. They introduce stupid taxes like this and yet has very little taxes on cigarettes or alcohol (you can buy 700ml Johnny Walker scotch here for $14AUD and the long neck beers are around $1 each :)
There is no dole, if your unemployed and have no money your in trouble (there are welfare payments but they are for specific circumstances).
People don't get personal bank loans as much when buying cars, they save the money and buy it outright.
In Australia just about everyone I knew, including myself, had started up their own business or tried to no matter how small scale. In Italy no one seems interested and I think it is mainly because the government doesn't seem to encourage it and makes things difficult with red tape (and something I was told about paying thousands in tax before you even start).
The Italian government announced they are increasing and adding new taxes to "help" the sluggish economy. I thought usually governments reduced taxes to encourage spending and growth of the economy but here they see things differently.
My girlfriend is Italian and her mother owns her house which is huge but over 300 years old and 2 apartments down the road in a small town of around 5,000 people (15 minutes from another town with around 120,000 people and 27km from Milan). Her aunt owns 2 apartments in the same block, another large house in the same town and another big 4 bedroom apartment in a seaside town called Sestri Levante (near Chinque Terre). They are all fully paid off but only rent out 1 of the units which I found crazy. They haven't attempted to rent them out, they are just empty all year round.
The Italian cities and towns I have been to don't seem to have massive suburbs like you see in Melbourne for instance. I live in a town outside Milan but I am only 20km away from the center of Milan.
